With only two weeks remaining for the Federal Board of Revenue (FBR) deadline, a mere fraction of retailers have voluntarily registered, posing challenges for the government's tax net expansion. According to FBR sources, fewer than 50 traders have registered since the launch of the campaign two weeks ago. The registration initiative was viewed as a political commitment by the Shahbaz Sharif government to broaden the tax base by including real estate, wholesalers, and retailers. The consequences of this slow registration could disproportionately affect the salaried class already grappling with high taxes. Additionally, there's a call to bring exporters on par with other economic sectors by eliminating the one percent income tax imposed on them. Launched on April 1, the FBR's registration scheme aims to register dealers, retailers, manufacturers-cum-retailers, and all entities involved in the supply chain.

While initially focusing on economic hubs like Karachi, Lahore, Islamabad, Rawalpindi, Quetta, and Peshawar, the lack of trader interest threatens the scheme's success. Failure of this initiative could also cast doubts on the viability of the Special Investment Facilitation Council, which endorsed the program. Despite an estimated 3.7 million retailers in Pakistan, only a fraction, less than 300,000, are registered. An FBR official highlighted the agency's efforts to expand the tax net. However, with a shortage of staff to monitor tax evasion and collect dues, over 2.4 million non-filers have been identified, with a commitment to address at least half a million since January.

Credit: Independent News Pakistan